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Oracle sued by one of its own gold-level Partners of the Year over government IT contract
We want $56 million, systems integrator tells court
Oracle has been sued by Plexada System Integrators in Nigeria for alleged breach of contract and failure to pay millions of dollars said to be owed for assisting with a Lagos State Government IT contract.
Plexada is seeking almost $56 million in denied revenue, damages, and legal costs for work that occurred from 2015 through 2020.
A partner at Plexada, filed a statement with the Lagos State High Court describing the dispute. The document, provided to The Register, accuses Oracle of retaliating against Plexada and trying to ruin the firm's business for seeking to be paid.
According to the partner's statement, Oracle in 2014 designated Plexada as "Oracle Partner of the Year – Africa Operations" and had a positive business relationship with the IT contractor. A 2015 article in CIOReview described Plexada as a gold-level partner with Oracle.
In 2013, Oracle's long-standing IT deal with the Lagos State Government, which involved software, hardware, training, and support ran into trouble – the government, it's claimed, failed to pay the agreed upon software support fees.
On November 13, 2013, at a meeting between Oracle and government officials, both parties nominated Plexada to mediate the relationship – without Plexada's prior knowledge, according to the court filing.
The deal, as described in the High Court statement, called for Plexada to recover the funds owed to Oracle by the government as of 2013 and to continue doing so for the next six years. The 2013 commission due to Plexada was to be $283,701.44.
At a subsequent meeting between regional Oracle executives and Plexada, the arrangement is said to have expanded to cover application support and to have entitled Plexada to receive 20 percent of the government deal's revenue.
Things went sideways almost immediately. Oracle and Plexada were invited to a meeting with top government officials on April 7, 2014 to discuss a public sector revenue management business opportunity, it's claimed.
It came to light that [Oracle] had tried to hijack the project from [Plexada] and push it to another company
"At the meeting, it came to light that [Oracle] had tried to hijack the project from [Plexada] and push it to another company – Catalyst," the statement reads. "This was a project that had clearly been identified and originated by [Plexada] and they had brought [Oracle] in at a later stage.
"In this meeting, it was clear to [Plexada] that there was some subterfuge happening against [the IT contracting firm] and that it was being orchestrated by staff of Lagos State Government as well as staff of [Oracle]."
The statement alleges Oracle and the Lagos State Government conspired to cut Plexada out of its intermediary position and to co-opt the firm's future business opportunities. It's claimed the government worked out an arrangement to pay Oracle directly – in contravention of the deal to have Plexada handle fee collection and provide support.
And when Plexada complained to Oracle, the database titan allegedly retaliated, conducting a whisper campaign against the firm to deprive it of future deals and taking money from its Oracle Partner account to cover the outstanding amount owed by the Lagos government.
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"[Oracle] maliciously debited [Plexada's] account with the sum outstanding and unpaid by the Lagos State Government," the statement says, adding Oracle subsequently downgraded its partner status for "inability to remit monies" due to Oracle that Plexada was supposed to collect from the government on Oracle's behalf.
Efforts to rectify the situation went on for years, culminating with a flurry of 13 emails to relevant Oracle personnel between February 4, 2020 and May 19, 2020. The partner said he received one reply – a note to schedule a meeting to discuss the dispute to which there was no follow-up.
In addition to monetary compensation, damages, and court costs, Plexada wants to be reinstated as an Oracle Partner and recognized with the appropriate specializations in the Oracle Partner Network. What's more, the IT biz wants Oracle to run full-page ads in four newspapers – three Nigerian and one Ghanaian – stating that Plexada is an Oracle Partner in good standing.
Oracle did not immediately respond to a request for comment. ®
PS: Oracle billionaire Larry Ellison has made his Hawaiian island more hospitable to the super-rich and pushed out families who have been there for generations, according to Bloomberg.